Nasdaq:LIQT
LIQTECH INTERNATIONAL INC
A specialized technology provider delivering critical aerospace and defense solutions with a strong R&D focus but facing persistent net losses.
Key Metrics
Investment Thesis
Bull Case
The stock may offer speculative value for investors betting on a future turnaround in the aerospace sector, where the company's niche product lines could generate significant margins once current inventory levels normalize and fixed costs are optimized. Recovery of R&D investments into new technologies could eventually unlock profitability if demand from defense contractors increases.
Bear Case
The company remains unprofitable with four consecutive years of net losses and a massive $94.8M deficit in retained earnings, creating substantial risk for dilution through equity issuance to fund operations. Investors should avoid the stock given the negative cash flow from operations and limited liquidity compared to its long-term liabilities.
About LIQTECH INTERNATIONAL INC
LIQTECH INTERNATIONAL INC. provides advanced technology solutions primarily serving the aerospace, defense, and energy sectors with a focus on specialized components and systems. The company operates globally, leveraging its engineering expertise to deliver high-performance products for critical infrastructure applications. Revenue of $16.5M in 2025 reflects continued operations despite recent profitability challenges.
Analysis
Management Discussion
While revenue recovered to $16.5M in 2025 from a dip in 2024, the company continues to burn cash with negative operating cash flow of $6.1M and a net loss of $8.6M. The widening gap between revenue growth and profitability suggests high operating leverage or elevated general and administrative costs that management has yet to address effectively.
Industry Overview
The aerospace and defense technology industry is characterized by high barriers to entry due to stringent regulatory requirements and long development cycles for specialized components. Companies in this space often face volatile revenue streams tied to government budgets and geopolitical events, requiring substantial capital reserves to survive downturns.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $16.0M | $18.0M | $14.6M | $16.5M |
| Cost of Revenue | $15.4M | $15.2M | $14.4M | $15.3M |
| Gross Profit | $567.1K | $2.8M | $250.9K | $1.3M |
| Operating Expenses | $13.1M | $10.6M | $9.7M | $9.6M |
| Operating Income | $-12.5M | $-7.8M | $-9.5M | $-8.3M |
| R&D | $1.8M | $1.4M | $1.4M | $1.2M |
| G&A | $5.7M | $4.9M | $5.7M | $5.7M |
| Stock-Based Comp | $934.4K | $627.9K | $664.4K | $987.1K |
| D&A | $2.6M | $3.1M | $2.2M | $1.7M |
| Depreciation | $2.0M | $2.5M | $2.1M | $1.7M |
| Amortization | $81.0K | $105.5K | $71.4K | $7.8K |
| Other OpEx | $5.6M | $4.3M | $2.7M | $2.7M |
| Non-Operating Income | $-1.9M | $-978.3K | $-896.2K | $-294.7K |
| Pre-Tax Income | $-14.4M | $-8.8M | $-10.4M | $-8.6M |
| Income Tax | $-237.4K | $-206.2K | $-38.8K | $-1.5K |
| Continuing Ops | $-14.2M | $-8.6M | $-10.3M | $-8.6M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $-14.2M | $-8.6M | $-10.3M | $-8.6M |
| Minority Interest | $0 | $0 | $0 | $-74.3K |
| Net to Common | $-14.2M | $-8.6M | $-10.3M | $-8.5M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $27.7M | $22.1M | $20.6M | $16.0M |
| Cash & Equivalents | — | $10.4M | — | $5.1M |
| Accounts Receivable | $2.3M | $3.2M | $2.4M | $3.4M |
| Inventory | $4.1M | $5.3M | $5.5M | $6.5M |
| Prepaid Expenses | $1.7M | $337.4K | $168.4K | $245.7K |
| Other Current Assets | $19.6M | $2.9M | $12.5M | $733.9K |
| Long-Term Assets | $12.5M | $13.9M | $11.8M | $11.3M |
| PP&E (Net) | $8.3M | $9.0M | $6.6M | $5.8M |
| Intangibles | $212.9K | $114.6K | $39.4K | $36.1K |
| Goodwill | $226.1K | $233.7K | $220.7K | $248.1K |
| Operating Leases | $3.3M | $4.1M | $4.5M | $4.6M |
| Other LT Assets | $450.0K | $470.3K | $456.7K | $545.6K |
| Total Assets | $40.1M | $36.0M | $32.4M | $27.3M |
| Current Liabilities | $6.1M | $7.5M | $4.9M | $4.7M |
| Current Leases | $561.2K | $531.4K | $544.2K | $714.4K |
| Deferred Revenue | $649.6K | $382.6K | $109.3K | $141.0K |
| Other Current Liab | $1.8M | $3.0M | $1.8M | $2.1M |
| Long-Term Liabilities | $10.7M | $11.2M | $10.9M | $12.2M |
| LT Operating Leases | $2.7M | $3.5M | $3.9M | $3.9M |
| Other LT Liab | $8.0M | $7.7M | $7.0M | $8.3M |
| Total Liabilities | $16.8M | $18.7M | $15.8M | $16.9M |
| Shareholders' Equity | $23.3M | $17.3M | $16.7M | $10.4M |
| Paid-In Capital | $96.9M | $98.8M | $109.3M | $110.4M |
| Retained Earnings | $-67.4M | $-75.9M | $-86.3M | $-94.8M |
| AOCI | $-6.3M | $-5.6M | $-6.4M | $-5.2M |
| Total L&E | $40.1M | $36.0M | $32.4M | $27.3M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $-14.2M | $-8.6M | $-10.3M | $-8.6M |
| Non-Cash Adjustments | $3.1M | $2.0M | $6.7M | $3.8M |
| Working Capital Changes | $-966.3K | $2.3M | $-3.9M | $-1.3M |
| Cash from Operations | $-12.0M | $-4.2M | $-7.5M | $-6.1M |
| Capital Expenditures | $1.7M | $2.9M | $1.4M | $395.2K |
| Cash from Investing | $-1.7M | $-2.9M | $-424.0K | $-217.9K |
| Cash from Financing | $13.7M | $580.6K | $8.5M | $719.3K |
| FX Effect | $-859.6K | $314.1K | $-88.6K | $-191.5K |
| Net Change in Cash | $-892.0K | $-6.2M | $446.5K | $-5.8M |
| Beginning Cash | $17.5M | $16.6M | $10.4M | $10.9M |
| Ending Cash | $16.6M | $10.4M | $10.9M | $5.1M |
Frequently Asked Questions
How does LIQTECH INTERNATIONAL INC make money?
Aerospace and Defense Systems, Energy Sector Solutions, and Specialized Component Manufacturing
What are the main risks for LIQT?
Persistent operating losses of $8.6M and a significant retained earnings deficit of $94.8M indicate solvency concerns, heavy reliance on cyclical government contracts, and potential inventory obsolescence given the long production cycles typical in aerospace.
What is LIQT's competitive advantage?
Deep technical expertise in niche high-performance applications, established relationships with major defense contractors, and proprietary engineering capabilities.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.